MIKE Ashley's Sports Direct have hit back in the fight over the merchandising arm of Rangers, by appointing a new director known as a legal enforcer in branding.

Justin Barnes who has served as international brand manager of Sports Direct International Plc and is known as an expert in intellectual property law has been appointed to the Rangers Retail board while Mr Ashley, the billionaire Sports Direct owner and the firm's chief executive David Forsey tendered their resignations.


Mr Barnes was one of the key people responsible for fashion shop group USC when it was put into pre-pack administration and subsequently bought back by Sports Direct debt-free and was engulfed in the controversy surrounding staff at its South Ayshire warehouse getting 15 minutes notice over the loss of their jobs.

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It had been hoped in some circles that the Sports Direct resignations may indicate a loosening of Mr Ashley's grip over the merchandising joint venture between Sports Direct and Rangers.

As brand manager for Sports Direct he has been responsible for Sports Direct brands such as Slazenger, Dunlop, Lonsdale, Everlast, Kangol, Karrimor, No Fear, Lillywhites, Donnay and Carlton.

But the election of just one replacement director on Rangers Retail has put the status of the board under question, as the terms of association require that there are not less than four directors on the board, two representing Sports Direct's interest and two representing Rangers.


There is so far no indication that a second director is being appointed.

Mr Ashley and Mr Forsey are understood to have stood down after attempts were made to convene a board meeting where it was expected challenging questions would be asked about the merchandising deal which means only 4p from every pound spent in the Ibrox store is banked by the Old Firm outfit.

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It was felt by some fans that the directors standing down was a "humiliation" as it appeared to be away to avoid questioning by Rangers executives Dave King and Paul Murray, who are on the Rangers Retail board.

The joint venture between Rangers and Sports Direct was confirmed by then chief executive Charles Green in August 2012, it was promoted as enabling Rangers "to once again control its retail operation and give supporters the chance to buy direct from the club and in doing so, continue to invest in its future".


But last month the Rangers board - unhappy with their return on the venture - served notice to cancel the merchandise deal with Rangers Retail Limited, controlled by Sports Direct. Rangers said it was withdrawing intellectual property rights from Rangers Retail which had the licences to exploit club-related trademarks and logos including the club name, Ibrox and The Gers, Intellectual property experts said that the move looked destined for a courtroom battle.

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It is understood that no challenge has yet been lodged by Sports Direct, which has a controlling vote on “financial matters” concerning Rangers Retail.

Mr Barnes, has been acting on a wide number of legal matters on behalf of Sports Direct for a number of years.

He was one of the key people responsible for fashion shop group USC when it was put into pre-pack administration and subsequently bought back by Sports Direct debt-free.


Philip Duffy of Duff and Phelps claimed at the Scottish Affairs Select Committee last year that Mr Barnes, who he said looked after all the brands in the Sports Direct group, was one of two members of a senior management team that ignored advice from the administrators Duff and Phelps to inform staff at a Scottish warehouse that they could lose their jobs.

MPs on the Scottish Affairs Select Committee were told by Philip Duffy of Duff and Phelps last year that he had held meeting with Mr Barnes and another executive Benjamin Gardener, at which he recommended that staff should be informed sooner rather than later.

USC's lack of consultation led to Dave Forsey, the Sports Direct chief executive facing criminal charges over the termination procedures, and he was accused of failing to inform the Business Secretary in advance.


Mr Duffy (above)  told the select committee: “We arranged a meeting with the company on the morning of the 9th [of January 2015]. On the morning of the 9th, we offered to give them [Mr Gardener and Mr Barnes] draft letters of consultation, saying, ‘You should be giving these to your employees.’ “We said, ‘We can prepare draft letters.’ We weren’t advising them. We said, ‘We think that you should do a consultation. Here are some standard letters that we would use in insolvency situations.’”

Four days later 79 permanent staff and 166 agency or zero-hour contract workers their posts at Dundonald, South Ayrshire were given only 15 minutes’ notice, despite USC executives allegedly receiving draft letters in advance.

In April, a bid to dismiss a criminal charge against Sports Direct's chief executive following the collapse of fashion retailer USC was rejected.

He is accused of breaching section 194 of the Trade Union and Labour Relations (Consolidation) Act 1992 along with Robert Palmer, an administrator of USC. Both pleaded not guilty.

In December, a group of shareholders managed to block Ashley's suggested appointment of Gardener to the board of retailer Findel over concerns he may not be a suitable candidate.

Investors with a combined 43.9 per cent stake – all agreed to vote against the appointment

Until Mr Barnes' arrival, Cameron Olsen (below), head of legal and company secretary of Sports Direct was the only Ashley representative on the Rangers Retail board, acting as company secretary.


Two weeks ago Rangers launched a civil court action against four of the club's former executives, Sports Direct and its owner Mike Ashley.

The case brought against former chief executives Charles Green and Derek Llambias, former commercial director Imran Ahmad, former financial director Brian Stockbridge, SportsDirect.com Retail and Mr Ashley is being dealt with at the Court of Session in Edinburgh.

It is understood the action concerns the controversial merchandise deal.